Qualification Amount Increase

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This topic contains 14 replies, has 5 voices, and was last updated by  AnnsFlight 2 months, 2 weeks ago.

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  • #48877

    Hello NACA,

    I was approved for the amount I asked for back in February and I am looking for an increase because I cannot find anything in the market that I am looking at for my approval amount.What is the official process if I am looking for a qualification amount increase? I have already submitted 30 days of paystubs and 2(30 day) bank statements that reflect a payment shock of the amount I am looking for. I even sent my counselor a letter from my employer stating my annual and gross monthly salary. Do I have to go through the qualification process from square 1? I flew to Orlando for the “achieve the dream” event to get approved,because my local office was very difficult to communicate with. I couldn’t find much documentation regarding an increase after being approved please help!

    Best Regards,

    Rich

    #48878

    rochel3628
    Member

    search “qualification increase” in the forum and read though the pass question and answers to your question.

    #48880

    southflorida
    Member

    Ask your counselor to submit your file to underwriting again but you need to prove to your counselor that your qualification can be improved.

    You can be approved for a monthly payment (including taxes, insurance and HOA) of up to 31% of your gross monthly income. However, this 31% combined with your minimum monthly payment obligations can’t be more than 40% of your gross monthly income. For example, if your monthly debt payments including car note, credit cards, student loans, etc are more than 9% of your gross monthly income, then you won’t be approved for the full 31% of your monthly income. For example, if your monthly debt payments (they only consider the minimum amount you have to pay) are 15% of your gross monthly income, the maximum you will get approved is 25% of your gross monthly income because both the mortgage payment (including taxes, insurance and HOA) and the monthly debt payments can’t be more than 40% of your monthly gross income.

    If you would like to be approved for 31% of your gross monthly income and your monthly debt payments are not more than 9% of your gross monthly income and your monthly rent is less than 31% of your gross monthly income, you need to save the difference between your rent payment and 31% of your monthly income for about 6 months, that’s called payment shock and you need to save your payment shock every single month, if you don’t save that amount 1 month, the clock starts again. Saving your payment shock is not only to put that amount on your savings account every month, they will add the balances of all your bank accounts and the total balance has to increase by at least your payment shock.

    #48890

    Thanks for the information South Florida,
    My gross is 7500 per month and I am looking to be around $1800(including HOA taxes etc.), which is under 25% of my gross. I have no other debt besides student loans which is only $170 per month. I have about at least 10 months of expenses saved (not including retirement). Based on your response, a 3 month payment shock should satisfy my counselor for an increase correct? I saved $1800 month one and $3000 month 2.
    Best Regards,

    Rich

    #48892

    southflorida
    Member

    do you pay rent? or, do you live with a family member?

    #48897

    Both and my understanding is that if I am paying $500 a month I would need to save the difference ($1300)to satisfy the shock requirement of $1800`.

    #48901

    southflorida
    Member

    You can get approved for a monthly payment of $2,325, try to get qualified for that amount. It happened to me that I thought I was fine with a certain amount and I ended up having to have my qualification amount increased twice until I finally was approved for 31% of my monthly gross income in order to buy what I needed. It happens that people underestimate the amount that you need to be approved for

    #48903

    OK I will be mindful of that Thank You!

    #48920

    nlemmon
    Member

    Hi, I have a similar question, during intake at an event with a remote counselor. She asked me the question of how much I would like to pay for my mortgage every month. Is that question based on how much they would approve me for? Currently, the price on houses are going up and I would like to get approved for a good amount to avoid the qualification increase process. I currently make $5,200 a month. I currently live with a family member.

    #48923

    southflorida
    Member

    try to get approved for the maximum possible which is 31% of your gross monthly income, in your case it would be $1,612

    #48926

    nlemmon
    Member

    Thanks for your help Southflorida

    #48927

    nlemmon
    Member

    So, do you know around about how much they might pre-qualify me for let’s say I have no outstanding debt.

    #48967

    They will qualify you for whatever payment shock you can produce over 6 months consistently if you have no other debt. If you want to be qualified today they would go based on the lowest month amount you have saved over the last six months with some flexibility if you had a surplus one month directly connected to your payroll. NACA can be very petty for good reasons but their “one size fits all” hurts some of us who avoid debt and pay a little extra on debt because we have the financial flexibility to do so. I would save as much as you can each month and ask for that. I want an 1800 a month payment but I am saving well over 2k each month. So I will ask for 2k even though I want an $1800 payment ideally. To get in the right ball park divide your monthly income by three and that’s what they will likely pre-qualify you for.

    #48982

    nlemmon
    Member

    I understand and thanks that was very helpful.

    #49140

    AnnsFlight
    Member

    Good info! Thanks.

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